Economics at your fingertips  

German labor market and fiscal reforms 1999–2008: Can they be blamed for intra-euro area imbalances?

Niklas Gadatsch, Nikolai Stähler () and Benjamin Weigert ()

Journal of Macroeconomics, 2016, vol. 50, issue C, 307-324

Abstract: In this paper, we assess the impact of major German structural reforms from 1999 to 2008 on key macroeconomic variables. These reforms, especially the Hartz labor market reforms, are considered by many to be the root of observed imbalances in the Euro Area. Our simulations within a two-country monetary union DSGE model show that, in terms of German GDP, consumption, investment and (un)employment, the reforms had clearly favorable effects, though the impact on the German current account was only minor. Also, the rest of the Euro Area benefited from positive spillover effects. Hence, our analysis suggests that the reforms cannot be held responsible for the macroeconomic imbalances currently visible in the Euro Area.

Keywords: Fiscal policy; Labor market reforms; DSGE modeling; Macroeconomics (search for similar items in EconPapers)
JEL-codes: H2 J6 E32 E62 (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Access Statistics for this article

Journal of Macroeconomics is currently edited by Douglas McMillin and Theodore Palivos

More articles in Journal of Macroeconomics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

Page updated 2018-05-29
Handle: RePEc:eee:jmacro:v:50:y:2016:i:c:p:307-324